How to buy Shares using Demat Account? - Investallign

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How to buy Shares using Demat Account?
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Demat Account
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The Procedure for buying Shares through a Demat
Account

• The stock market and share trading are the two
  most-talked topics in India. People want to trade
  in stocks, but they have a fear of losing money.
• Experts say that it is not a market of
  speculations as many people think. Instead, it is
  a market based on thorough financial concepts.
• By understanding the trends, one can make a
  fairly accurate assumption about the ups and
  downs in the market.
• A long-term perspective is always better than day
  trading.
• With the introduction of Demat in India, there
  has been an enormous increase in the number of
  people trading in the stock market.

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The Procedure for buying Shares through a Demat
Account

• The digitization made share trading, brokerage
  calculation and account settlement simple.
• Before you start trading, it is significant to
  open a Demat account if you havent opened so
  far. After opening the Demat account, you can
  source a broker to facilitate in the share
  trading.
• Nowadays, all brokers offer an online platform
  that makes the things amazingly convenient.
• The blog tells about share trading using the
  Demat account in detail.

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• Get the PAN Card first
• Getting Permanent Account Number or PAN in India
  is easy.It is the basic requirement for
  performing any financial transaction.
• Nowadays it is mandatory to have the PAN. You
  need to apply for it with the supporting
  documents. The Department of Finance will allot
  the number, and a card is issued in the name of
  the cardholder.
• Open a Demat account
• Once you get the PAN, open a Demat account.
  Either fill the online form and send the
  supporting documents in the digitized form or
  fill in the physical form and attach attested
  documents.
• You need to give the application form to the
  brokerage company you want to transact with. Once
  the documents are verified, you get Demat
  account.
• It can be used for buying and selling stocks,
  mutual funds, and derivatives.

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• Depository Participant or DP is an agency that
  stores the shares that you hold. NSDL and CDSL
  are two depository participants in India. They
  issue a unique identification number to every
  investor.
• Choose the broker
• Usually, the same broker gives you a trading
  account who opens the Demat account.
• The share broker is certified and authorized by
  the Security Exchange Board of India or SEBI to
  act as a broker. SEBI issues a license and unique
  identification number to the broker.
• He is the intermediary between the trader and the
  stockbroking firm. He charges a small amount as
  the brokerage for every transaction sell or
  purchase.

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• Buying and selling shares
• Once you open Demat account and link it with the
  trading account, you can buy or sell stocks
  online. You can also do it by giving instructions
  to the broker over phone.
• Shares bought and sold on the same trading day is
  called intraday trading. Shares that you hold and
  sell on a trading day later is called delivery
  trading. The brokerage for intraday trading is
  less than the delivery trading.
• Brokerage is calculated and deducted online in
  the profit or loss incurred by you. If you dont
  have balance in the trading account, then you
  need to replenish it to trade further.
• Also Read
• What is the Difference between Demat Account and
  Trading Account?

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